Evolus (EOLS) risk factors, FY2025 10-K

Risks Related to Our Business and Strategy

1. 01We have incurred significant losses since our inception, and we may continue to incur losses, which could adversely affect the market price of our common stock and our ability to raise additional capitalNew
2. 02Our products face significant competition and our failure to effectively compete may prevent us from achieving significant market penetration and expansion
3. 03Our products may fail to achieve the broad degree of aesthetic practitioner adoption and use or consumer demand necessary for continued commercial success81% rewritten
4. 04The degree and rate of practitioner adoption of Jeuveau®, Evolysse™, and any future product candidates depend on a numberNew
5. 05Our products rely on consumer discretionary spending and the purchasing decisions of our customers, both of which are sensitive to difficult to predict global economic conditions, including the imposition of tariffs, or changes in consumer or customer sentimentNew
6. 06Our business is subject to trade policy risks, including tariffs and regulatory actions on imports which may have a material adverse impact on our results of operations and financial conditionNew
7. 07We are reliant on Symatese to achieve and maintain regulatory approval for the Evolysse™ product line in the United States. Failure to obtain approval, maintain approval, or obtain approval on our estimated time frame for additional Evolysse™ products would negatively affect our ability to sell these products
8. 08We may require additional financing to fund our future operations or execute corporate development activities, and a failure to obtain additional capital when so needed on acceptable terms, or at all, could force us to delay, limit, reduce or terminate our operations91% rewritten
9. 09The terms of the Medytox Settlement Agreements will reduce our profitability until the royalty obligations expire, and may affect the extent of any discounts we may offer to our customers
10. 10Our ability to market our products is limited to their indicated uses, and if we want to expand the indications for which we market our products, we will need to obtain additional regulatory approvals, which will be expensive and may not be granted
11. 11We rely on our digital technology and applications and our business and operations could suffer in the event of information system failures or a cybersecurity incident
12. 12Our use of, or failure to effectively and responsibly utilize, emerging technologies, including artificial intelligence, could materially adversely affect our business and financial resultsNew
13. 13Failure to comply with confidentiality and data privacy obligations could have a material adverse effect on our business
14. 14Jeuveau® or any other product candidate for which we seek approval as a biologic may face competition sooner than anticipated80% rewritten
15. 15reference products in a way that is similar to traditional generic substitution for non-biological products is not yet clear and will depend on a number of marketplace and regulatory factors that are still developingNew
16. 16Our products may cause serious or undesirable side effects or possess other unexpected properties that could delay or prevent their regulatory approval, limit the commercial profile of approved labeling, result in post-approval regulatory action or in product liability lawsuits35% rewritten
17. 17Our failure to successfully in-license, acquire, develop and market additional product candidates or approved products would impair our ability to grow our business
18. 18Our international operations will expose us to risks, and failure to manage these risks may adversely affect our operating results and financial condition
19. 19Fluctuations in currency exchange rates may negatively affect our financial condition and results of operations
20. 20If we fail to attract and keep senior management and key personnel, we may be unable to market and sell our products successfully, or any future products we develop
21. 21Our strategy of focusing exclusively on the cash-pay healthcare market may limit our ability to increase sales or achieve profitability
22. 22We may need to increase the size of our organization, including our sales and marketing capabilities, in order to further market and sell our products and we may experience difficulties in managing this growth
23. 23Our business involves the use of hazardous materials, and we and our third-party manufacturer and supplier must comply with environmental laws and regulations, which can be expensive and restrict how we do business
24. 24We may use third-party collaborators to help us develop, validate or commercialize any new products, and our ability to commercialize such products could be impaired or delayed if these collaborations are unsuccessful
25. 25Our ability to use our net operating loss carryforwards and certain other tax attributes may be limited30% rewritten
26. 26Increases in interest rates would increase the cost of servicing our debt and could reduce our profitability and limit our cash available to fund our growth strategy71% rewritten

Risks Related to Our Relationship with Our Licensors

1. 27We rely on the Daewoong Agreement, the Symatese U.S. Agreement and the Symatese Europe Agreement and any termination or loss of significant rights, including exclusivity, under these agreements would materially and adversely affect our businessNew
2. 28We currently rely solely on Daewoong to manufacture Jeuveau®, and on Symatese to manufacture Evolysse™ and as such, any production or other problems with either licensor could adversely affect us
3. 29Any failure or refusal by our licensors or any other third party to supply our products that we may develop could delay, prevent or impair our clinical development or commercialization efforts
4. 30We forecast the demand for commercial quantities of our products, and if our forecasts are inaccurate, we may experience delays in shipments, increased inventory costs or inventory levels, and reduced cash flow

Risks Related to Intellectual Property

1. 31Third-party claims of intellectual property infringement may prevent or delay our commercialization efforts and interrupt our supply of products40% rewritten
2. 32may be able to block our ability to develop and commercialize the applicable product candidate unless we obtain a license or until such patent expires. In either case, such a license may not be available on commercially reasonable terms or at allNew
3. 33If we or any of our current or future licensors, including Daewoong and Symatese, are unable to maintain, obtain or protect intellectual property rights related to our products, we may not be able to compete effectively in our market49% rewritten
4. 34applications that we may in-license may fail to result in issued patents with claims that cover any of our future product candidates in the United States or in other foreign countries, and the issued patents that we may in-license may be declared invalid or unenforceableNew
5. 35We may become involved in lawsuits to protect or enforce our intellectual property or the patents and other intellectual property of our licensors, which could be expensive and time-consuming
6. 36We may not be able to protect our intellectual property rights throughout the world
7. 37In addition to seeking patents for our product candidates, we also rely on trade secrets, including unpatented know-how, technology and other proprietary information, to maintain our competitive position
8. 38We may be subject to claims that our employees, consultants or independent contractors have wrongfully used or disclosed confidential information of third parties
9. 39We may need to license intellectual property from third parties, and such licenses may not be available or may not be available on commercially reasonable terms
10. 40If our trademarks and trade names are not adequately protected, then we may not be able to build name recognition in our markets of interest and our business may be adversely affected

Risks Related to Government Regulation

1. 41Our business and products are subject to extensive government regulation
2. 42We may not obtain regulatory approval for the commercialization of any future product candidates
3. 43If any future product candidates fail to demonstrate safety and efficacy in clinical trials or do not gain approval, our business and results of operations will be materially and adversely harmed
4. 44Jeuveau® and Evolysse™ and any other regulated products we may offer in the future are subject to continual regulatory review by the FDA, the EMA and other similar regulatory authorities
5. 45If we fail to obtain regulatory approvals in foreign jurisdictions for our products or any future product candidates, we will be unable to market our products outside of the United States
6. 46Our products or any future products may cause or contribute to adverse medical events that we are required to report to regulatory agencies and if we fail to do so, we could be subject to sanctions that would materially harm our business
7. 47We may in the future be subject to various U.S. federal and state laws pertaining to health care fraud and abuse, including anti-kickback, self-referral, false claims and fraud laws, and any violations by us of such laws could result in fines or other penalties
8. 48Legislative or regulatory healthcare reforms in the United States and other countries may make it more difficult and costly for us to obtain regulatory clearance or approval of any future product candidates and to produce, market, and distribute our products after clearance or approval is obtained26% rewritten
9. 49Each of these would likely entail substantial time and cost and could materially harm our business and our financial results. In addition, delays in receipt of or failure to receive regulatory clearances or approvals for any future products would harm our business, financial condition and results of operations

Risks Related to Our Common Stock

1. 50Derivative lawsuits have been filed against us and certain of our officers and directors, which could result in substantial costs and could divert management attention
2. 51The trading price of our common stock has been volatile, and purchasers of our common stock could incur substantial losses
3. 52Sales by us of a substantial number of shares of our common stock in the public market, or the perception that these sales might occur, could significantly reduce the market price of our common stock and could impair our ability to raise capital through the sale of additional equity securities
4. 53Anti-takeover provisions in our certificate of incorporation and bylaws, as well as Delaware law, could discourage a takeover
5. 54Our certificate of incorporation and bylaws provide that we can indemnify our directors and officers, in each case to the fullest extent permitted by Delaware law. Separate indemnity agreements have been issued with each director and executive officer30% rewritten
6. 55determined that such person is not entitled to indemnificationNew
7. 56Our business could be negatively affected as a result of actions of activist stockholders, and such activism could impact the trading value of our securities
8. 57If securities or industry analysts publish unfavorable research about our business or decrease the frequency or cease to provide coverage of our company, our stock price and trading volume could decline
9. 58We have not paid dividends in the past and do not expect to pay dividends in the future, and any return on investment may be limited to the value of our stock
10. 59The requirements of being a public company may strain our resources, divert management’s attention and affect our ability to attract and retain executive management and qualified Board members